Employee credibility is important for businesses as it encourages loyalty and reduces turnover. To establish credibility as a leader, you must be a trusted source of information and make reliable decisions. There are different types of credibility such as presumed, reputed, surface, and earned credibility. Earned credibility involves gaining legitimate trust through actions like listening to employees, taking responsibility, and being open and honest. Building credibility also requires inspiring people, learning from failures, and not avoiding difficult conversations. Credibility is built on factors like competence, character, and caring. Overall, organizations should prioritize credibility to benefit from innovative solutions and loyal relationships.